Key Takeaways:
- There have been rumors linking the newly detained Tornado Cash developer to the FSB in Russia.
- Alexey Pertsev worked for the FSB in the past.
The Notorious Lazarus Group in North Korea is accused of using Tornado Cash to launder money, leading the U.S. Treasury Department to sanction the company earlier this month.
The Dutch authorities later detained Alexey Pertsev, a resident of the Netherlands, on suspicion of “involvement in hiding unlawful financial flows and enabling money laundering” as a result of this restriction.
According to a report from the intelligence agency Kharon, Pertsev previously worked for a business associated with the Russian Security Agency FSB.
The U.S. government’s targeting of an open-source software project provoked outrage from the global crypto community in response to the action.
According to national security specialists, the latest material on Pertsev’s past paints a murkier image, who also contends that the public is not fully informed about the penalties.
According to the firm’s research, Pertsev worked for the Russian company Digital Security OOO as a smart contract developer and information security specialist in 2017.
As early as 2015, the Treasury Department determined that Digital Security OOO was in charge of giving the FSB material and technical support.
According to Alex Zerden, a senior fellow and adjunct at the Center for a New American Security, this raises many credibility concerns for Tornado Cash’s creators. This is some profound information that explains why the Dutch and American governments have taken their actions.
“You had this man working for Digital Security OOO and doing pen testing himself, and then Treasury designated the business for supporting the FSB’s hacking skills,” said Nick Grothaus, vice president of research at Kharon.
This sparked a discussion on how the US government could target an open-source software project in the cryptosphere. Even US lawmaker Tom Emmer questioned the Treasury Department’s OFAC to explain why it sanctioned Tornado Cash in an ‘unprecedented’ manner.
The fresh information suggests differently, though. The background of Pertsev paints a very grim picture of the ongoing problem. National security specialists have noted that the general public is not aware of all the details of the restrictions.
With demonstrators assembling in Amsterdam to call for his release and chanting, “open source [code] is not a crime,” Pertsev’s detention increased privacy worries.
In comparison to the immediate reaction from the crypto community to assume nefarious motives by government authorities, Zerden claimed that the new information from Kharon is in stark contrast. He argued that officials frequently cannot share information with the public due to classification requirements.
